This Goofy Diagram Does A Remarkably Good Job Explaining What's Happening In The Eurozone

In a note authored Astrid Schilo of Exane BNP
Paribas on the politics and disfunction of the Eurozone, this
drawing is shown to describe the current situation.

Exane BNP
Paribas

This is really the story of the year in a nutshell.

The ECB has done an extoardinary amount of work in 2012
establishing itself as a real monetary authority that has the
power to backstop the entire financial system (as exists in
England, the US, and Japan). And that is super-powerful in and of
itself (and it's why
Mario Draghi should be Person Of The Year).

But other than the ECB -- which has the benefit of being
undemocratic -- the rest of the project remains a mess. There's
no political union, fiscal union, banking union, or common
Eurozone budget, all of which need to exist for the project to
actually work sustainably.

It's a huge deal that the sovereign debt part of the crisis came
to an end (for the most part) in 2012. But there's massive heavy
lifting yet to come.